Audacity can record audio through a microphone or any other audio input device including computer playback. Multiple channels can be recorded at once.

Sound files can be imported and exported in many different audio formats, and tracks with different sample rates are converted in real time. Conversions are done using high-quality re-sampling and dithering.

Audacity includes effects that can be applied to audio, such as echo, reverb, phaser, wahwah, reverse, and others. Additional effects can be added with plug-in support for VST, Nyquest, LADSPA, and Audio Unit. Altering pitch, tempo, equalizing, and background noise removal are also built into Audacity.